123 T.C. No. 20
UNITED STATES TAX COURT
BARBARA DRAKE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 4126-04. Filed December 14, 2004.
On Sept. 30, 2003, P filed a bankruptcy petition
under ch. 13 of the Bankruptcy Code. On Jan. 29, 2004,
R issued to P a notice of determination disallowing her
claims for relief from joint and several liability
under sec. 6015, I.R.C., for the taxable years 1991,
1992, 1994, 1995, and 1997. On Mar. 8, 2004, P filed a
petition with the Court challenging R’s notice of
determination. R filed a motion to dismiss for lack of
jurisdiction in this case on the ground that the
petition was filed in violation of the automatic stay
imposed under 11 U.S.C. sec. 362(a)(8) (2000).
- 2 -
Held: The Court lacks jurisdiction in this case
on the ground the petition was filed in violation of
the automatic stay imposed under 11 U.S.C. sec.
362(a)(8). R’s motion to dismiss for lack of
jurisdiction will be granted.
Timothy J. Burke, for petitioner.
Louise R. Forbes and David Abernathy, for respondent.
OPINION
GERBER, Chief Judge: This case was assigned to Chief
Special Trial Judge Peter J. Panuthos, pursuant to the provisions
of section 7443A(b)(5) and Rules 180, 181, and 183.1 The Court
agrees with and adopts the opinion of the Special Trial Judge,
which is set forth below.
OPINION OF THE SPECIAL TRIAL JUDGE
PANUTHOS, Chief Special Trial Judge: This matter is before
the Court on respondent's motion to dismiss for lack of
jurisdiction. Respondent’s motion presents an issue of first
impression: whether the automatic stay imposed under 11 U.S.C.
section 362(a)(8) (2000) bars the filing of a petition with this
Court in a so-called stand-alone proceeding brought pursuant to
section 6015. As discussed in detail below, we shall grant
respondent’s motion to dismiss.
1
Unless otherwise indicated, section references are to
sections of the Internal Revenue Code, as amended, and Rule
references are to the Tax Court Rules of Practice and Procedure.
- 3 -
Background
On September 30, 2003, petitioner filed a voluntary petition
for relief under chapter 13 of the Bankruptcy Code with the U.S.
Bankruptcy Court for the District of Massachusetts.
On January 29, 2004, respondent issued to petitioner a
notice of determination disallowing her claim for relief under
section 6015 for the taxable years 1991, 1992, 1994, 1995, and
1997.
On March 8, 2004, petitioner filed with the Court a Petition
for Determination for Relief From Joint and Several Liability
challenging respondent’s notice of determination.2 At the time
the petition was filed, petitioner’s bankruptcy case had not been
closed or dismissed, nor had the bankruptcy court granted or
denied petitioner a discharge. See 11 U.S.C. sec. 362(c)(2)
(2000).
In response to the petition, respondent filed a motion to
dismiss. Respondent contends that the Court lacks jurisdiction
because the petition was filed in violation of the automatic stay
imposed under 11 U.S.C. sec. 362(a)(8). On May 3, 2004,
petitioner filed an objection to respondent’s motion to dismiss.
On June 3, 2004, respondent filed a response to petitioner’s
objection.
2
At the time the petition was filed, petitioner resided in
South Yarmouth, Mass.
- 4 -
This matter was called for hearing at the Court’s motions
session held in Washington, D.C., on July 14, 2004, and for
further hearing at the Court’s motions session held in
Washington, D.C., on September 15, 2004. Counsel for respondent
appeared at the hearings and offered argument in support of
respondent’s motion to dismiss. During the latter hearing,
counsel for respondent informed the Court that petitioner’s
bankruptcy case had been converted to a chapter 7 proceeding on
September 2, 2004. Although there was no appearance by or on
behalf of petitioner at the hearing, petitioner filed with the
Court a written statement pursuant to Rule 50(c) and a supplement
thereto.
Discussion
The Tax Court is a court of limited jurisdiction, and we may
exercise our jurisdiction only to the extent authorized by
Congress. Naftel v. Commissioner, 85 T.C. 527, 529 (1985).
Before proceeding with our analysis, we review the scope of our
jurisdiction over claims for relief under section 6015 and the
provisions that define the automatic stay.
Section 6015
Section 6013(d)(3) provides that if a husband and wife file
a joint Federal income tax return, “the tax shall be computed on
the aggregate income and the liability with respect to the tax
shall be joint and several.” However, section 6015(a) provides
- 5 -
that, notwithstanding section 6013(d)(3), an individual who has
made a joint return may elect to seek relief from joint and
several liability on that return. For a detailed discussion of
the legislative history of section 6015 (and its predecessor,
section 6013), see Cheshire v. Commissioner, 115 T.C. 183, 188-
189 (2000), affd. 282 F.3d 326 (5th Cir. 2002).
Congress vested the Court with jurisdiction to review a
taxpayer’s election to claim relief from joint and several
liability on a joint return under specified circumstances. See
King v. Commissioner, 115 T.C. 118, 121-122 (2000); Corson v.
Commissioner, 114 T.C. 354, 363-364 (2000). A taxpayer may seek
relief from joint and several liability on a joint return by
raising the matter as an affirmative defense in a petition for
redetermination invoking the Court’s deficiency jurisdiction
under section 6213(a). See Butler v. Commissioner, 114 T.C. 276,
287-288 (2000). In addition, a taxpayer may file a so-called
stand-alone petition seeking relief from joint and several
liability on a joint return where the Commissioner has issued a
final determination denying the taxpayer’s claim for such relief
or the Commissioner has failed to rule on the taxpayer’s claim
within 6 months of its filing. See sec. 6015(e)(1); Mora v.
Commissioner, 117 T.C. 279 (2001); Fernandez v. Commissioner, 114
T.C. 324 (2000). Finally, a taxpayer may request relief from
joint and several liability on a joint return in a petition for
- 6 -
review of a lien or levy action. See secs. 6320(c),
6330(c)(2)(A)(i).
The petition in this case was filed as a stand-alone
petition in response to respondent’s notice of determination
dated January 29, 2004. Although petitioner filed her petition
within 90 days of the mailing of the notice of determination, we
must determine whether the filing of that petition was barred by
the bankruptcy automatic stay.
The Automatic Stay
Title 11 of the United States Code provides uniform
procedures designed to promote the effective rehabilitation of
the bankrupt debtor and, when necessary, the equitable
distribution of his or her assets. See H. Rept. 95-595, at 340
(1977). One key to achieving these aims is the automatic stay,
which generally operates to temporarily bar actions against or
concerning the debtor or property of the debtor or the bankruptcy
estate. See Allison v. Commissioner, 97 T.C. 544, 545 (1991);
Halpern v. Commissioner, 96 T.C. 895, 897 (1991).
Actions which are subject to the automatic stay are set
forth in 11 U.S.C. section 362(a), which provides in pertinent
part:
(a) Except as provided in subsection (b) of this
section, a petition filed under section 301, 302, or
303 of this title, * * * operates as a stay, applicable
to all entities, of --
- 7 -
(1) the commencement or continuation, including the
issuance or employment of process, of a judicial,
administrative, or other action or proceeding against the
debtor that was or could have been commenced before the
commencement of the case under this title, or to recover a
claim against the debtor that arose before the commencement
of the case under this title;
In addition, 11 U.S.C. section 362(a)(8) expressly bars “the
commencement or continuation of a proceeding before the United
States Tax Court concerning the debtor.”
Actions which are excepted from the automatic stay are set
forth in 11 U.S.C. section 362(b) (2000), which provides in
pertinent part:
(b) The filing of a petition under section 301,
302, or 303 of this title, * * * does not operate as a
stay--
* * * * * * *
(9) under subsection (a), of --
(A) an audit by a governmental unit to determine tax
liability;
(B) the issuance to the debtor by a governmental
unit of a notice of tax deficiency;
(C) a demand for tax returns; or
(D) the making of an assessment for any tax and
issuance of a notice and demand for payment of such an
assessment * * *.
Unless relief from the automatic stay is granted by order of
the bankruptcy court, see 11 U.S.C. sec. 362(d) (2000), the
automatic stay generally remains in effect until the earliest of
the closing of the case, the dismissal of the case, or the grant
or denial of a discharge, 11 U.S.C. sec. 362(c)(2); see Allison
- 8 -
v. Commissioner, supra at 545; Smith v. Commissioner, 96 T.C. 10,
14 (1991).
It is worth noting that 11 U.S.C. section 362(b)(9)(B)
excepts from the automatic stay the issuance of a notice of
deficiency to the taxpayer/debtor under section 6213(a). See
Kieu v. Commissioner, 105 T.C. 387, 391 (1995). Even though, as
previously discussed, such a taxpayer would be barred from filing
a petition for redetermination with this Court so long as the
automatic stay remained in effect, see 11 U.S.C. sec. 362(a)(8),
Congress established a procedure to permit such a taxpayer to
invoke the Court’s deficiency jurisdiction under section 6213(a)
after the automatic stay is no longer in effect. Specifically,
section 6213(f) provides that the period for filing a timely
petition with the Court under section 6213(a) is suspended for
the period during which the taxpayer is prohibited by reason of
the automatic stay from filing a petition for redetermination and
for 60 days thereafter. See Olson v. Commissioner, 86 T.C. 1314,
1318-1319 (1986). We observe that the benefits of section
6213(f) may apply whether a notice of deficiency is mailed to the
taxpayer before or after the filing of a bankruptcy petition.
See McClamma v. Commissioner, 76 T.C. 754 (1981).
We also observe, however, that there is no provision
analogous to section 6213(f) in section 6015 that tolls the
statutory period for filing a timely stand-alone petition for the
- 9 -
period during which the person is prohibited by reason of the
automatic stay from filing such a petition. Nor is there any
cross-reference in section 6015 to the procedures set forth in
section 6213.3 On the other hand, if the taxpayer raises a
section 6015 claim as an affirmative defense in a petition for
redetermination invoking the Court’s deficiency jurisdiction
under section 6213(a), the taxpayer would be able to take
advantage of the benefits of section 6213(f).
Analysis
Consistent with the plain language of 11 U.S.C. section
362(a)(8), which expressly bars “the commencement or continuation
of a proceeding before the United States Tax Court concerning
the debtor”, we conclude that the petition for determination of
relief from joint and several liability in this case was filed in
violation of the automatic stay, and, therefore, we lack
jurisdiction. In short, there is no exception to the automatic
stay under 11 U.S.C. section 362(b) that permits the filing of a
petition for determination of relief from joint and several
liability, nor is there any suggestion in the record that the
bankruptcy court granted petitioner relief from the automatic
3
In contrast, when Congress drafted sec. 6404(g) (now sec.
6404(h)) for the purpose of expanding the Court’s jurisdiction to
review requests for abatement of interest, the provision included
special rules expressly referring to sec. 6213. To the same
effect, sec. 7436(d), involving determinations of employment
status, includes a cross-reference to sec. 6213(f).
- 10 -
stay under 11 U.S.C. section 362(d). Under the circumstances,
the automatic stay will remain in effect until petitioner’s
bankruptcy case is closed or dismissed or a discharge is granted
or denied. See 11 U.S.C. sec. 362(c)(2).
It follows from our holding in this case that petitioner has
effectively lost the opportunity to obtain judicial review of
respondent’s notice of determination in this Court.4 In
particular, Congress did not include in section 6015 a tolling
provision comparable to section 6213(f) that would extend the
period for petitioner to file a petition for determination of
relief from joint and several liability with the Court. Although
the outcome in this case may seem at odds with the public
policies underlying section 6015, the gap in the section 6015
procedures that this case highlights is not one that can be
closed by judicial fiat. A remedy, if any, must originate with
Congress. In the end, we are obliged to grant respondent’s
motion to dismiss.
4
However, petitioner may still have a remedy. We note
that in certain circumstances debtors are permitted to raise
claims for relief from joint and several liability before the
bankruptcy court. See In re Hinckley, 256 Bankr. 814 (Bankr.
M.D. Fla. 2000) (debtor permitted to raise sec. 6015 claim in
objection to the Commissioner’s proof of claim); French v. United
States, 242 Bankr. 369 (Bankr. N.D. Ohio 1999) (debtor permitted
to raise sec. 6015 claim in adversary proceeding brought pursuant
to 11 U.S.C. sec. 505(a)).
- 11 -
To reflect the foregoing,
An order of dismissal for
lack of jurisdiction will be
entered.